Microsoft provides compensation to executives in the form of a variety of incentive compensation plans including restricted stock award grants. The following is an excerpt from a disclosure note from Microsoft's 2009 annual report:
1. What is the “incentive” provided by Microsoft's restricted stock grants?
2. If all awards are granted, vested, and forfeited evenly throughout the year, what is the compensation expense in fiscal 2009 pertaining to the previous and current stock awards? Explain. Assume forfeited shares were granted evenly throughout the three previous years.